Revenue Recognition

3 Months Ended

Mar. 31, 2020

Note 3 – Revenue Recognition

Revenue by Category

The following table presents our revenue disaggregated by major service line:



	Transco		Northwest Pipeline		Gulf of Mexico Midstream		Northeast Midstream		West Midstream		Other		Eliminations			Total
	(Millions)
Three Months Ended March 31, 2020
Revenues from contracts with customers:
Service revenues:
Regulated interstate natural gas transportation and storage	$	604	$	115	$	—	$	—	$	—	$	—	$	(2	)	$	717
Gathering, processing, transportation, fractionation, and storage:
Monetary consideration	—		—		99		312		299		—		(22		)	688
Commodity consideration	—		—		5		2		21		—		—			28
Other	3		—		6		41		9		—		(5		)	54
Total service revenues	607		115		110		355		329		—		(29		)	1,487
Product Sales:
NGL and natural gas	20		—		32		29		359		—		(29		)	411
Total revenues from contracts with customers	627		115		142		384		688		—		(58		)	1,898
Other revenues (1)	—		—		2		5		3		8		(3		)	15
Total revenues	$	627	$	115	$	144	$	389	$	691	$	8	$	(61	)	$	1,913


Three Months Ended March 31, 2019
Revenues from contracts with customers:
Service revenues:
Regulated interstate natural gas transportation and storage	$	570	$	114	$	—	$	—	$	—	$	—	$	—		$	684
Gathering, processing, transportation, fractionation, and storage:
Monetary consideration	—		—		128		239		344		—		(18		)	693
Commodity consideration	—		—		13		5		46		—		—			64
Other	—		—		4		32		11		—		(4		)	43
Total service revenues	570		114		145		276		401		—		(22		)	1,484
Product Sales:
NGL and natural gas	24		—		58		47		479		—		(58		)	550
Total revenues from contracts with customers	594		114		203		323		880		—		(80		)	2,034
Other revenues (1)	3		—		4		5		4		7		(3		)	20
Total revenues	$	597	$	114	$	207	$	328	$	884	$	7	$	(83	)	$	2,054

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(1)

Revenues not within the scope of Accounting Standards Codification Topic 606, “Revenue from Contracts with Customers,” consist of leasing revenues associated with our headquarters building and management fees that we receive for certain services we provide to operated equity-method investments, which are reported in Service revenues in our Consolidated Statement of Operations, and amounts associated with our derivative contracts, which are reported in Product sales in our Consolidated Statement of Operations.

Contract Assets

The following table presents a reconciliation of our contract assets:



	Three Months Ended March 31,
	2020			2019
	(Millions)
Balance at beginning of period	$	8		$	4
Revenue recognized in excess of amounts invoiced	23			19
Minimum volume commitments invoiced	(13		)	(1		)
Balance at end of period	$	18		$	22

Contract Liabilities

The following table presents a reconciliation of our contract liabilities:



	Three Months Ended March 31,
	2020			2019
	(Millions)
Balance at beginning of period	$	1,215		$	1,397
Payments received and deferred	28			33
Significant financing component	3			4
Recognized in revenue	(57		)	(99		)
Balance at end of period	$	1,189		$	1,335

Remaining Performance Obligations

Remaining performance obligations primarily include reservation charges on contracted capacity for our gas pipeline firm transportation contracts with customers, storage capacity contracts, long-term contracts containing minimum volume commitments associated with our midstream businesses, and fixed payments associated with offshore production handling. For our interstate natural gas pipeline businesses, remaining performance obligations reflect the rates for such services in our current Federal Energy Regulatory Commission (FERC) tariffs for the life of the related contracts; however, these rates may change based on future tariffs approved by the FERC and the amount and timing of these changes are not currently known.

Our remaining performance obligations exclude variable consideration, including contracts with variable consideration for which we have elected the practical expedient for consideration recognized in revenue as billed. Certain of our contracts contain evergreen and other renewal provisions for periods beyond the initial term of the contract. The remaining performance obligation amounts as of March 31, 2020, do not consider potential future performance obligations for which the renewal has not been exercised and excludes contracts with customers for which the underlying facilities have not received FERC authorization to be placed into service. Consideration received prior to March 31, 2020, that will be recognized in future periods is also excluded from our remaining performance obligations and is instead reflected in contract liabilities.

The following table presents the amount of the contract liabilities balance expected to be recognized as revenue when performance obligations are satisfied and the transaction price allocated to the remaining performance obligations under certain contracts as of March 31, 2020.



	Contract Liabilities		Remaining Performance Obligations
	(Millions)
2020 (remainder)	$	110	$	2,552
2021	132		3,293
2022	117		3,149
2023	107		2,640
2024	99		2,350
Thereafter	624		18,985
Total	$	1,189	$	32,969

Accounts Receivable

The following is a summary of our Trade accounts and other receivables – net:



	March 31, 2020		December 31, 2019
	(Millions)
Accounts receivable related to revenues from contracts with customers	$	791	$	890
Other accounts receivable	139		106
Total reflected in Trade accounts and other receivables – net	$	930	$	996